Clearwire appears to be leaning towards an outright acquisition by current parent company Sprint Nextel, though noted that it was still reviewing options. The update was provided as part of a proxy statement filed by Clearwire with the Securities and Exchange Commission.
“Clearwire today announced that it has filed a preliminary proxy statement in connection with its definitive agreement with Sprint Nextel Corporation for Sprint to acquire the approximately 50% stake in Clearwire that it does not already own for $2.97 per share,” Clearwire noted in a statement.
Clearwire in mid-December accepted an offer that would have Sprint Nextel acquire the remaining 50% of the company it does not currently control for approximately $2.2 billion. That deal followed an offer by Japan’s Softbank to acquire a 70% stake in Sprint Nextel for $20.1 billion, which Sprint Nextel CEO Dan Hesse said was necessary in order to put in the offer on Clearwire.
However, that proposal was usurped last month by an offer from Dish Networks to “acquire up to all of Clearwire’s common stock for $3.30 per share (subject to minimum ownership of at least 25% and granting of certain governance rights) and provide Clearwire with financing on specified terms.” The offer also calls for Dish to acquire approximately 24% of Clearwire’s total megahertz/pops of spectrum for $2.2 billion and would provide Dish with the option to acquire or lease up to an additional 2 megahertz of spectrum adjacent to the spectrum being acquired at an additional cost. Dish is also offering a commercial agreement with Clearwire that would call for Clearwire to construct, operate, maintain and manage a network for Dish and its 2 GHz spectrum holdings as well as new deployments for Clearwire’s 2.5 GHz spectrum.
While Clearwire said it was still evaluating all options, it did note that in the end it would do what was best for “all non-Sprint Nextel class A shareholders.”
Sprint Nextel took the latest news as a victory, noting in a statement:
“Today’s filing speaks for itself. After a rigorous and extensive two-year process, Clearwire pursued numerous strategic opportunities, including discussing the sale of spectrum with no fewer than 10 parties and a series of ongoing conversations with Dish that date back to 2010. Clearwire’s proxy makes very clear that Sprint’s definitive agreement to acquire Clearwire provides both the best value for shareholders and stability amid an uncertain future. We continue to believe that the Dish proposal is illusory and conditioned on many things, including the receipt of governance rights, a spectrum sale and a commercial agreement which are not actionable under our merger agreement and other agreements between Clearwire and Sprint. We are pleased the Clearwire board continues to recommend approval of our transaction and look forward to closing our merger and delivering even greater wireless service to the American consumer.”
Clearwire’s stock price (CLWR) was unchanged early Friday at $3.18 per share. Sprint Nextel’s stock price (S) was trading up slighty, while Dish’s stock price (DISH) was also up slightly early Friday.
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